In Russia poultry producers actively purchasing feed plants

The number of independent feed companies in relation to the number of the same enterprises having being integrated into the holdings during the past several years has been in significant decline.

Representatives of the national association of feed producers noted the declining trend at a recent Moscow conference “Compound Feed 2012”.

Only this month of February did the Russian Federal Antimonopoly Service approve the purchasing of shares in individual feed mills by different poultry farms.

In particular it is reported that large poultry complex Kochubeevskoe of Stavropol Krai plans to buy 100% of the shares of Belorechensk feed mill.

At the same time, the poultry farm Vasilyevskaya (Penza Oblast), which is part of the Cherkizovo holding company, announced its plans to increase its ownership stake in Penza bread-making plant from 62.2% to 93.4% of the shares this year.

According to experts, the investing to the purchasing of the feed mill can quickly pay off for poultry companies since it may decrease the primary cost of production process of about 8-10 rubles (US$ 0.26-0.33) per kilogram.

“This is a single strain of logic: if we have our own feed to feed our poultry, we do not have to buy it on the side, so the cost of the final products is reduced.

"Therefore to ensure that the production rate will continue to grow, we need to increase capacity of our own compound feed production,” said Maria Shirokova, spokesman for the Cherkizovo group.

According to Russian feed industry experts, the number of independent enterprises has decreased by 35% over the past three years, and is still rapidly declining.

As a result, representatives of associations of producers repeatedly stressed that about 25% of feed in Russia is hidden from the statistics.